Illinois state revenue allocated for wagering income tax generated in the state during the fiscal year 2025, which corresponds to the period from July 2024 to June 2025, increased to $2.234 billion
The main thing, however, wasn’t a new product entering the market; it was scale, or more venues, more terminals, alongside an ever-expanding sports betting channel.
One thing quite noticeable in the breakdown from the state itself is that video gaming took the top position. The state of Illinois closed out FY2025 with 49,000+ video gaming terminals and $3.086 billion in net terminal income, as well as significant state and local taxes.
Sports Betting Grew, Then Got More Expensive to Run
That structure matters because it pressures high-volume operators the most—and it can change how books price promos, limits, and even whether they pass fees to bettors (as seen in the market reaction and surcharge talk).
Sports betting continues to grow and was recorded to have increasingly rising figures in FY2025 of adjusted gross receipts of over $1.3 billion and sports wagering tax revenues of around $429 million in 2025. Illinois added one more layer of costs: a per-wager privilege tax on online bets, effective July 1, 2025, $0.25 per wager for the first 20,000,000 wagers per operator annually, and $0.50 after that.
This makes sense because that structure pressures high-volume operators the most. That could possibly change how books price promos, limits, and whether they pass fees to bettors (as seen in the market reaction and surcharge talk).
The State Is Tightening Digital Controls Without Legal iGaming
Although sports-betting regulation is within Illinois code, unlicensed Internet gambling sites remain prohibited under Illinois law, and authorities have been seizing them. Additionally, there were 65 cease and desist letters issued during early February 2026 by state regulators for matters related to online gaming. That indicates a more aggressive posture for enforcement.
On the payment side, the state also took action to reduce the harm vectors as Illinois became the seventh state to ban credit cards as a payment option to sports wagering through the rule-making process, as highlighted in April 2025 reporting.
What to Watch Next
Illinois has proven it can grow a regulated gambling base fast without online casino legalization. The policy question now is whether lawmakers treat iGaming as a new revenue lever, a consumer-protection tool (pulling play from offshore), or a political risk.
If you’re assessing Illinois as an operator, supplier, or investor, the opportunity is real, but so are the barriers. The combination of high, evolving tax mechanics and active enforcement means 2026 is more about who can operate profitably while staying compliant, especially if iGaming remains stalled.
